World Caution turned to Vietnam today (3.7.2025), since Donald Trump announced a trade agreement with Hanoi, a few days before the reciprocal reciprocal duties of Washington.
According to the agreement, the United States will implement a 20% duty on imports from Vietnam – much lower than the 46% rate imposed by Trump in early April. US imports to Vietnam will not be subject to duties in the meantime.
Trump also said that Vietnam agreed to impose a 40% duty on each product originating from another country, but was sent to Vietnam for a final mission to the US. China is said to have repeatedly based on this practice, known as Transshipping, to avoid trade barriers.
Vietnam is one of the few countries that have entered into a trade agreement with the White House, while time counts on Trump’s 90 -day temporary suspension. Many nations have been left to wonder how the future of their trade relations with the world’s largest economy could be formed.
“What we have learned from the Vietnam Agreement is that, if anything, the duties will increase from now on, not decrease,” said Sebastian Raedler, head of CNBC’s European Early Edition show.
But other countries may now have easier negotiation, Mark Williams, a leading economist at Capital Economics for Asia, told CNBC.
“Other countries will feel that they should be able to lock a lower tariff rate than 20% that President Trump said that he has agreed Vietnam,” he said, noting that “Vietnam had an unusually weak negotiating hand” because of its strong US.
More deals in emerging markets?
The agreement could be the cause of concern for other emerging economies such as Vietnam, Citi’s economists and strategic analysts said in their note.
“In general, we believe that there is more about Em Asia to worry than expect profits if this agreement reflects what is going to come soon,” they said.
While evolution removes uncertainty and suggests that other agreements could arise in the coming days, the tariff rate of 20% is higher than the expected 10% contribution to goods, according to Citi experts. They add that the distinct factor of 40% for the transported goods suggests that other countries may need to agree on such a duty.
“Thailand, followed by Malaysia, may be more exposed to other like -like East Asian countries (except for Vietnam). A separate and more punitive duty for transported goods was the least expected from the market,” the note said.
“In addition, there may be a secondary impact on other exporters who have created factories in Vietnam in previous years,” for example in Korea, added.
However, experts who have spoken to CNBC Spoke expect several other trade deals in the coming days, with Williams noting that the US is appearing open to making these “rough” frameworks rather than “complete” agreements.
One of the countries that have been exploited as possible the next deal is India, says Trinh Nguyen, a senior economist for emerging Asian countries at Natixis Cib. The agricultural sector could emerge as an obstacle, as India “will find it difficult to allow the US to access the market without domestic reactions,” he proposed.
What could the agreement on Europe mean
While the Vietnam-USA agreement suggests that there are more agreements for other Asian countries, it does not necessarily mean that the same applies to the European Union, Lavanya Venkateswaran, a senior ASEAN economist at OCBC Bank, told CNBC.
“The Vietnam authorities were clear about their intention to negotiate with the US, even before reciprocal announcements made in April,” he said, adding that the same applies to other regional economies such as Indonesia and Malaysia.
‘In comparison to these economies, the case with [την] The EU has not always been smooth and the US has been more public in their criticism of the EU at various times in recent months, “Venkateswaran said.
In the meantime, Nguyen of Natixis Cib added that “Vietnam shows that it is very difficult for Europe to get what it wants – that is, without duties.”
It is likely that some duties will be imposed, he said, and while the EU could retaliate by applying equal duties in the US, Nguyen expects the EU to agree on a 10% duty and “will try to win the sector”.
Trade negotiations between the EU and the US are difficult and are slow to evolve, with sources telling CNBC that a “political” agreement with minimal details can be the EU’s best hope at this point. Analysts and economists have also expressed uncertainty about the possibility of a trade agreement, database of basic engagement points, such as the regulation of large technology, taxation and widely incompatible worldviews.
Trump has requested that up to 50% duties be imposed on the EU, while the block has threatened with extensive countermeasures, which have also been suspended until next week.